United States

The Dow Jones Industrial Average climbed 0.9% and the S&P 500 added 0.2%, halting a three-day losing streak, while the Nasdaq slipped 0.4% as AI names stayed under pressure. The rotation showed up most clearly in the equal-weighted S&P 500, which strips out the heft of the mega-caps and jumped 1.4%. The Philadelphia Semiconductor Index fell 2.5%.

CoreWeave again sat at the centre of the AI nerves after a measure of credit risk at the data centre operator hit an all-time high. The stock pared its losses after Nvidia chief Jensen Huang defended the cloud provider’s financial health. Concerns about CoreWeave’s viability have fed a wider worry that the AI infrastructure buildout has outpaced companies’ ability to earn a return on it. Crossbridge Capital argued that demand for AI is real, but cautioned that not every company building the infrastructure will generate attractive returns for investors.

Inflation remains the other headache. US producer prices rose 1.3% in September, the largest monthly gain since March 2022, and 6.3% from a year earlier as higher energy costs worked through the economy. That followed Wednesday’s hotter-than-expected inflation report, which pushed traders to add to bets on further Fed rate hikes. Treasuries rallied regardless, with the 10-year yield down 10 basis points to 5.09%.

Attention now turns to Fed Chair Kevin Warsh, who speaks in Bangkok late Thursday New York time in a fireside chat with IMF Managing Director Kristalina Georgieva. Evercore expects Warsh to steer clear of signalling an October hike, given the global wobble in tech and tighter financing conditions for the more exposed AI names.

In corporate news, Anthropic told prospective investors its third-quarter revenue reached $US16.8 billion, according to people familiar with the matter, as it pushes ahead with plans to list. Charles Schwab beat earnings estimates on strong retail investor activity, though bank deposits and net interest margin fell short. Penske Automotive agreed to go private with its two largest shareholders at an enterprise value of $US16.3 billion.

Europe

European investors took the defensive route as the tech selloff spread. The Stoxx 600 rose 0.4% and London’s FTSE 100 gained 1%, with Swiss and French benchmarks also higher. Telecoms and food and beverage makers led, while Novartis and AstraZeneca added the most points to the regional index. Societe Generale described pharma as a natural portfolio stabiliser against tech weakness.

Chipmakers tracked the global slump, with ASML and Infineon each down more than 4%. Miners fell after Antofagasta reported weaker-than-expected copper production, and banks, energy and industrials also lost ground. European stocks remain below their August records, with early earnings season results set to test whether profits can support a year-end rally. German 10-year yields fell five basis points to 3.41%.

*Note: These prices are based on futures and/or CFD pricing and may therefore differ slightly from spot pricing.

Commodities and Currencies

Gold rose 1.3% to $US4,157.91 an ounce. Oil sent mixed signals, with Brent down 0.2% at $US105.89 a barrel while West Texas Intermediate gained 2.8% to $US97.71. Iron ore eased 0.6% to $US89.95 a tonne.

The US dollar retreated from an 18-month peak, with the Bloomberg Dollar Spot Index down 0.3%. The euro rose 0.5% to $US1.1215 and the pound gained 0.6% to $US1.3275. The Australian dollar moved the other way, down 0.8% at US69.18 cents. Bitcoin rose 0.5% to $US82,003.

Economic Calender

EU:

• CPI YoY 20:00

US:

• Industrial Production MoM 00:15
• Manufacturing Production MoM 00:15